Cable TV

BENGALURU: Comcast Corporation (Comcast) reported a 4 per cent y-o-y growth in consolidated revenue (TR) in Q3-2014 to $ 16,791 million from $ 16,151 million in Q3-2013. However, q-o-q, the company’s revenue was almost flat with a fractional drop of 0.3 per cent from $ 16,844 million.

Talking about the latest earnings, Comcast chairman and CEO Brian L Roberts said, “I am pleased to report strong revenue, operating cash flow and free cash flow growth for the third quarter of 2014. Cable results highlight the consistent strength of high-speed Internet and business services, and video customer results were the best for a third quarter in seven years. We continue to focus on innovation and providing the best experience for our customers, and we are thrilled with the response to our superior X1 platform, which recently reached five million boxes deployed. At NBC Universal, we had another outstanding quarter with double-digit operating cash flow growth, driven by ratings momentum at NBC Broadcast and the successful opening of The Wizarding World of Harry Potter-Diagon Alley in Orlando.”

Comcast’s consolidated operating expenditure (Expenditure) in Q3-2014 at $ 11,087 million was 2.5 per cent more than the $ 10,821 million in Q3-2013 and 0.4 per cent more than the $ 11,040 million in Q2-2014.

Comcast’s Earnings per Share (EPS) for the third quarter of 2014 was $ 0.99, a 52.3 per cent increase from the $ 0.65 reported in the third quarter of 2013. EPS for Q2-2014 was $ 0.76, (excluding gain on a sale and transaction-related costs, EPS in Q2-2014 was $0.75). Excluding income tax adjustments and transaction-related costs in Q3-2014, EPS increased 12.3 per cent to $ 0.73.

The company’s net income after taxes, attributable to Comcast in Q3-2014 increased 49.7 per cent to $ 2,592 million from $ 1,732 million in Q3-2013. Net Income attributable to Comcast Corporation in Q2-2014 was $ 1,992 million.

Comcast Business Streams

Two main business streams contribute to Comcast: Cable Communications (between 60 and 65 per cent of TR) and NBC Universal (between 35 and 40 per cent of TR).

Video, high speed internet, voice, business services and other businesses are a part of Cable Communications. Cable Communications Video Revenue consists of analogue, digital, premium, pay-per-view, equipment services and residential video installation revenue. Other Cable Communications Revenue include franchise and other regulatory fees, digital media centre, commissions from electronic retailing networks and fees for other services.

Overall, Cable Communications reported a 5.2 per cent growth in Q3-2014 to $ 11,041 million dollars (65.8 per cent of TR) from $ 10,491 million (65 per cent of TR) in Q3-2013 and was almost flat (grew by 0.1 per cent) from the $ 11029 million (65.5 per cent of TR) in Q2-2014.

Cable Communications Expenditure in Q3-2014 at $ 6,577 million was 5.3 per cent more than the $ 6,245 million in Q3-2013 and 1.7 per cent more quarter on quarter than $ 6,465 million.

Here is what the company has to say about Cable Communications:

‘Customer relationships increased by 82,000 to 26.9 million during the third quarter of 2014, more than three-times the customer relationship net additions in the third quarter of 2013. At the end of the third quarter, penetration of our triple product customers increased to 36 per cent compared to 34 per cent in the third quarter of 2013. High-speed Internet customer net additions improved versus last year and were the strongest for a third quarter in five years. Video customer net losses improved 36 per cent year-over-year and were the best result for a third quarter in seven years. Voice net additions slowed, reflecting a focus on double play during the back-to-school season, as well as X1 availability that was more focused on triple play customers last year, making for a difficult comparison.’

NBC Universal:

Comcast’s NBC Universal grew 1.2 per cent in Q3-2014 to $ 5,921 million (35.3 per cent of TR) from $ 5,851 million (36.2 per cent of TR) in Q3-2013, but shrank 1.6 per cent from $ 6,016 million (35.7 per cent of TR) in Q2-2014. Operating Cash Flow increased 13.3 per cent in Q3-2014 to $ 1.4 billion as compared to $ 1.3 billion in Q3-2013, driven by strong results at Broadcast Television and Theme Parks, says the company.

NBC Universal Expenditure in Q3-2014 at $ 4,505 million was 6.6 per cent lower than the $ 4,601 million in Q3-2013 and 1.7 per cent lower than the $ 4,582 million in Q2-2014.

Cable Networks:

NBC Universal’s Cable Networks’ revenue in Q3-2014 at $ 2,255 million was 0.7 per cent more than $ 2,239 million in Q3-2013, but 8.9 per cent lower than $ 2,476 million reported for Q2-2014.

Cable Networks’ expenditure in Q3-2014 at $ 1,387 million was 0.1 per cent more than the $ 1,386 million for the corresponding quarter year ago and 11.2 per cent lower than the $ 1,562 million in Q2-2014.

Advertising revenue from Cable Networks shrank 4.7 per cent to $ 796 million in Q3-2014 from $ 835 million in Q3-2013 and was 15.8 per cent lower than $ 945 million in Q2-2014.

Cable Networks’ distribution revenue grew 5.1 per cent in Q3-2014 to $ 1,281 million in Q3-2014 from $ 1,219 million in Q3-2013 and grew 0.9 per cent from $ 1,270 million in Q2-2014.

Its content licensing and other revenue shrank 3.8 per cent to $ 178 million in Q3-2014 from $ 185 million in Q3-2013 and fell a massive 31.8 per cent from $ 261 million in the immediate trailing quarter.

Television Broadcasting:

NBC Universal’s Television Broadcasting revenue grew 7.7 per cent to $ 1,770 million in the current quarter from $ 1,644 million in Q3-2013, but was 2.5 per cent less than the $ 1,816 million in Q2-2014.

Television Broadcasting Expenditure in Q3-2014 at $ 1,628 million was 1.1 per cent more than the $ 1,610 million in Q3-2013 and 3.3 per cent more than the $ 1,576 million in Q2-2014.

Television Broadcasting advertising revenue in Q3-2014 grew 4.4 per cent to $ 1,153 million from $ 1,104 million in Q3-2013, but was 7.4 per cent lower than the $ 1,245 million in Q2-2014. Broadcast Television content licensing revenue grew by 13.2 per cent from $ 355 million in Q3- 2013 to $ 402 million in the current quarter and was 16.9 per cent higher than $ 344 million in Q2-2014. Other revenue for Broadcast Television grew 16.2 per cent to $ 215 million in Q3-2014 from $ 185 million in Q3-2013, but was 5.3 per cent lower than $ 227 million in Q2-2014.

Filmed Entertainment:

NBC Universal’s Filmed Entertainment revenue in Q3-2014 was 15.3 per cent lower at $ 1,186 million from $ 1,400 million in Q3-2013 and 0.9 per cent more than $ 1,176 million in Q2-2014. The company attributes this drop to the tough competition with the strong box office performance of Despicable me 2 in Q3-2013.

Filmed Entertainment Expenditure in Q3-2014 at $ 1,035 million was 14.5 per cent lower than the $ 1,211 million in Q3-2013, but 5.5 per cent higher than the $ 981 million in Q2-2014.

Theatrical revenue in Q3-2014 at $ 265 million was 52.6 per cent lower than the $ 550 million in Q3-2013, and 35.9 per cent more than $ 195 million in Q2-2014. Filmed Entertainment content licensing revenue at $ 439 million was 15.8 per cent more than $ 355 million in Q3-2013 but 5 per cent lower than the $ 462 million in Q2-2014.

Home Entertainment revenue at $ 321 million in Q3-2014 fell 10.6 per cent from $ 359 million in Q3-2013 and was 11.8 per cent less than the $ 364 million in Q2-2014. Filmed Entertainment’s other revenue at US$ 161 million in Q3-2014 was 58.3 per cent more than the $ 103 million in Q3-2013 and was 3.9 per cent more than the $ 159 million in Q2-2014.

Theme Parks

NBC Universal’s Theme Park revenue at $ 786 million was 18.9 per cent more than the $ 661 million in Q3-2013 and 27.8 per cent more than the $ 615 million in Q2-2014.

Theme Park Expenditure in Q3-2014 at $ 384 million was 20.8 per cent more than the $ 318 million in Q3-2013 and 3.5 per cent more than the $ 371 million in Q2-2014.